Japan readies to wager all on a casino-led recovery

Yoshiaki Nohara and Yuki Yamaguchi

For trainee dealer Taichi Yahagi, the odds of making a better living turning cards at a baccarat table in Tokyo are looking up.

The 41-year-old tutor paid about $US5000 ($5200) for a three-month course at the Japan Casino School, betting Prime Minister Shinzo Abe will succeed in his push to allow gaming houses to be built in time for the 2020 Tokyo Olympic Games. Discussions on the bill to legalise casinos started last week, with debate to resume in the parliament's next session this year.

''I probably wouldn't have enrolled in the casino school unless the Olympics were coming,'' said Mr Yahagi, whose work teaching children has dwindled given Japan's low birth rate. ''We need foreigners to visit for the Games and spend at casinos. Otherwise, Japan's economy won't pick up at all.''

Foreign investors view the debate as a litmus test for Mr Abe's ability to revitalise the economy, and successful passage of the bill will boost the equity market, according to Mizuho Securities. Anti-gambling groups say Japan's obsession with pachinko parlours and horse racing causes enough trouble already.

Just getting to the floor of the parliament is a breakthrough in the decade-long effort to legalise table gaming, with the bill on course for passage by year-end, says Takeshi Iwaya, an MP from the Liberal Democratic Party.

Mr Abe is seeking to triple the number of tourists visiting Japan each year to more than 30 million by 2030. Foreign arrivals reached a record 10.4 million in 2013 as a weaker yen made visits cheaper.

Japan's casino market could be worth as much as $US40 billion and MGM Resorts International and Las Vegas Sands said in February they would invest as much as $US10 billion each. Others such as James Packer's Crown Resorts have already launched a media marketing campaign, pitching its merits as a casino operator.

Previous efforts to build casinos failed because the industry was commonly associated with social ills, said Kazuaki Sasaki, assistant professor at Nihon University College of Economics. ''Many studies on casinos' ties with organised crime and gambling addiction will now be conducted,'' Dr Sasaki said.

About one in 10 adult males is addicted to gambling in Japan, where betting on horses, cycling and boating is legal. But pachinko, Japan's version of pinball, pushes the addiction rate higher than other nations. The industry had ¥19 trillion ($193 billion) in revenue in 2012.

Japanese companies are cheering Mr Abe on. Sega Sammy is trying to build a casino in South Korea and is interested in doing so in Japan. Konami, a maker of pachinko machines, plans to set up a casino subsidiary.